New York (HedgeCo.Net) – You would think that a teen-focused retailer that has Carly Rae Jepson as a “spokesmodel” is used to dealing with drama. This week, South Florida based retailer, Wet Seal, focused their teenage angst onto hedge fund Clinton Partners.
The kerfuffle began when Hedge Fund and 7% shareholder in Wet Seal, Clinton Partners, disclosed in a filing with the Securities and Exchange Commission that it would like to nominate five new board members. In the filing Clinton partners said that they “believe Wet Seal stockholders should indeed support our proposals and upgrade the Board of the Wet Seal.”
Wet Seal, took offense to this move and in a letter which was later described by Clinton Partners as “hysterical and misleading” challenged the Hedge Fund by stating that Clinton Partners has been day-trading Wet Seal stock and has “no long-term commitment to Wet Seal or its shareholders.”
Continuing the game of “he said, she said” Gregory P. Taxin Managing Director of Clinton Group, issued a statement to the investors.
“The Board’s claim that Clinton Group’s motives are suspect because we have been ‘day trading’ the stock is absurd. We have been the single largest net buyer of the Company’s stock in 2012. We have purchased more than 6.1 million shares, with cash. By contrast, before we started pressing this board, they had bought 20,000 shares in the aggregate during their entire, collective tenure as Board members. In fact, we purchased more stock this week than any single director has purchased in their entire tenure on the Board.”
Wet Seal hasn’t had a CEO since former-CEO Susan McGalla was fired in July. Prior to the firing of their CEO the stock was at a 52-week low. The stock has rebounded slightly, but at $3.20 is still well below their 52-week high.
Carly Rae Jepson, was not available for comment, but I have her number, so I’ll call her later.